Transurban slumps after pension fund sells stake

Matt O'Sullivan

Transurban shares slumped in early trading today after a Canadian pension fund, its second-largest shareholder, dumped its cornerstone stake in Australia’s largest toll-road owner.

The sale will now fuel speculation about what the Canada Pension Plan Investment Board will do with $903 million in cash from the divestment of about 12 per cent of the issued capital in Transurban.

Abu Dhabi’s sovereign wealth fund is reported to be one of the buyers.

Shares in Transurban fell 17 cents, or more than 3 per cent, to $5.19 this morning following the disclosure.

White Funds Management’s investment analyst, Will Seddon, said the Canada Pension Plan’s decision to offload its stake was likely to be a precursor to it pursuing another deal in a similar asset class.

‘‘They have to do something with the cash,’’ he said. ‘‘They seem to like the assets in Australia, and the [strong Australian] currency is probably not as much of an impediment to them because the Canadian dollar is strong.’’

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Late last year the Canada Pension Plan bought Australian toll-road owner Intoll, which was spun out of Macquarie Infrastructure Group, for $3.4 billion.